Rand Paul on Budget & Economy

Republican Kentucky Senator

Trillion-dollar deficits are bad, whether by Dems or by GOP

Q: Your objections to this week's funding agreement touched off an ever-so-brief government shutdown. What did you accomplish?

PAUL: We should draw attention to the fact that we're spending so much money. I ran for office in 2010 with which was called
the Tea Party tidal wave at that point, and we were very, very critical of President Obama's deficits, approaching a trillion dollars in a year. And I'm still against deficit spending. Just because Republicans are doing it doesn't make it any better.

Q: And now we have deficits projected to be a trillion dollars again, and yet in a growing non-recessionary economy. Are you troubled by that?

PAUL: Yes, I'm very worried. Republicans want more for military spending. And to get that, they have to give
Democrats what they want, which is more for domestic spending. And the compromise, while some say, "oh, it's bipartisanship," well, if the bipartisanship is exploding the deficit, I'm not so sure that's the kind of bipartisanship we need.

Liberty candidates agree to Audit The Fed

Q [to Sen. Rand PAUL]: Senator Cruz's campaign is out with a video saying that Cruz is the intellectual and political heir to your father's 2012 campaign and the liberty movement.

PAUL: We had an Audit-the-Fed vote, which was the biggest thing my dad
had been advocating for, for 30 years, Ted didn't have time to show up. He was the only Republican that didn't show up for it.

CRUZ: I very much respect Ron Paul; to win in the Republican Party [a candidate] has to be able to bring together the
disparate elements of the Reagan coalition: conservatives and evangelicals and libertarians. When it comes to the Audit-the-Fed bill, as Rand knows well, I was an original sponsor of the bill, I'm strongly supportive of it. It didn't have the votes to
pass. And I had commitments to be at a town hall in New Hampshire. But I look forward to signing that bill into law as president and auditing the Fed and providing needed accountability at the Federal Reserve.

The Fed is destroying the value of our currency

By artificially keeping interest rates below market rate, average citizens have a tough time earning interest, have a tough time making money. They're actually talking now about negative interest. As the Federal Reserve destroys the value of the
currency, what you're finding is that, if you're poor, if you make $20,000 a year and you have three or four kids, and you're trying to get by, as your prices rise or as the value of the dollar shrinks, these are the people that are hurt the worst.

Source: Fox Business/WSJ Second Tier debate
, Nov 10, 2015

Audit the Fed, and prevent the Fed from lobbying against it

I would like to thank Ted for co-sponsoring my bill, audit the Fed. I think it is a huge problem that an organization as powerful as the Fed comes in, lobbies against them being audited on the Hill. I would prevent them lobbying Congress.
I don't think the Fed should be involved with lobbying. I think we should examine how the Fed has been part of the problem. You want to study income inequality, let's bring the Fed forward and talk about Fed policy and how it causes income inequality.

Interest rates are simply price of money; keep the Fed out

Let's bring the Fed forward and have them explain how they caused the housing boom and the crisis, and what they've done to make us better or worse. I think the Fed has been a great problem in our society.
What you need to do is free up interest rates. Interest rates are the price of money, and we shouldn't have price controls on the price of money.

Federal Reserve is insolvent, by private bank standards

If the Federal Reserve was a real bank, without extraordinary powers, it would be insolvent. The Fed has $4.5 trillion in liabilities and only $57 billion in equity. It is leveraged at 80:1, nearly three times greater than Lehman Brothers when it failed.
Nearly 40% of the Fed's liabilities are said to be mortgage-backed securities--the question needs to be: How many are distressed home loans?

What does that mean?
It means the dollar that was once as good as gold ultimately became backed by the full faith and credit of the U.S. government. And since the panic of 2008, your dollar is now backed by bad home loans, bad car loans, and derivatives. Is anyone comforted?

Over the past one hundred years the dollar has lost 96 percent of its value. If the Fed were forced to do, what every ordinary bank must do--take its "assets" and mark them to their current market value--many believe the Fed would be insolvent.

More oversight of the Fed; less of community banks

After the banking crisis of 2008, we got alarmed and we passed regulations. The only problem is, we passed regulations on the banks that weren't involved and gave more power to the bank that was involved--the Fed.
No bank in Kentucky failed during this crisis, yet Dodd-Frank pummeled our small community banks with crippling regulations. What we really needed was more oversight of the Fed, not small community banks.

Sen. Bernie Sanders (I-VT) and I don't agree on much, but I thought he did a great job of describing the Fed and the bank bailouts as: "A clear case of socialism for the rich; and rugged-you're-on-your-own-individualism for everyone else."

The Fed, with unlimited ability to print money, now prints that money to lobby against Congressional oversight. It is a disgrace and every citizen in the land should rise up and say: We the people are in charge and we demand an audit!

Audit the Fed: currently no jurisdiction to do so

Some say the Fed is already audited. Well, when the auditor came to Congress, she was asked the identity of the debt bought by the Fed. She didn't know. When pressed on the case she responded, "We do not have the jurisdiction to directly go and audit
reserve bank activities."

Some worry about Fed independence. I do too. I worry about the Fed's independence from the Executive branch. The Fed is supposed to be overseen by Congress. Congress created the Fed.
The Fed is now in every nook and cranny of banking regulation since Dodd-Frank and it is a necessity that we not let the Executive branch gain unlimited power.

Any audit of the Fed should attempt to bring regulatory power
back under the control of Congress. Some worry that an audit would reveal which banks are shaky and lead to a panic. The audit doesn't occur until a year after the bill passes. When the 2011 audit occurred, no bank-runs ensued.

Is the Fed too big to be audited?

[At an Iowa event], Paul is focused on reviving his father's political base, by attacking an institution that has long frustrated the libertarian right: the Federal Reserve. Before Paul took the stage, organizers played a video featuring archival clips
of both Ron and Rand Paul delivering critiques of the central bank.

Minutes later, Paul, who last month introduced the Federal Reserve Transparency Act, drew raucous applause when he warned its policies are undermining U.S. currency. "Anybody here want
to audit the Fed?" Paul said. "Anybody feel that the Fed is out to get us? They're all over the TV! They're going to be out there saying, 'Oh, we can't audit the Fed.' What, are they too big to be audited? Too secret to be audited?"

[Remembering
his father's campaign in Iowa], Paul said chuckling, "We used to have an 'end the Fed' dunk booth over there," pointing toward a nearby sidewalk. "People threw balls at Ben Bernanke in order to get someone in the tank."

America needs Adam Smith, not Robin Hood

What the President fails to grasp is that the American system that rewards hard work is what made America so prosperous. What America needs is not Robin Hood but Adam Smith. In the year we won our independence, Adam Smith described what creates the
Wealth of Nations. He described a limited government that largely did not interfere with individuals and their pursuit of happiness.

Over the past 4 years the President has added over $6 trillion in new debt and may well do the same in a second term.
What solutions does he offer? He takes entitlement reform off the table and seeks to squeeze more money out of the private sector.

He says he wants a balanced approach. What the country really needs is a balanced budget.
Washington acts in a way that your family never could--they spend money they do not have, they borrow from future generations, and then they blame each other for never fixing the problem.

Larger government is not a solution for economy

[In USA Today, Aug. 10, 2010]: The bailouts and the federal takeovers of the past two years have made the federal government the nation's top mortgage lender and a major player in auto manufacturing, as well as Wall Street's ATM of first and last resort.
This departure from the limited government envisioned by the (US) Founders has encouraged too many Americans to forget their heritage of freedom. When there is a problem, Washington tells us, more government is the solution.

No federal bailouts of private industry

Dr. Paul opposes all federal bailouts of private industry. America is the land of opportunity, to succeed and to fail. It's time our government starts promoting responsibility.

Every dollar we print to service our debt, reduces the value of the money in your pocket. Rand will fight to strengthen the value of our Dollar so our purchasing power is not destroyed by the sneakiest tax of all: inflation.

Rand Paul on Spending Limits

Fiscal conservative on both domestic & military spending

We borrow a million dollars a minute. And the question I have for all Americans is, think about it, can you be a fiscal conservative if you don't conserve all of the money? If you're a profligate spender, you spend money in an unlimited
fashion for the military, is that a conservative notion? We have to be conservative with all spending, domestic spending and welfare spending. I'm the only fiscal conservative on the stage.

Source: Fox Business/WSJ Second Tier debate
, Nov 10, 2015

Filibuster against raising the debt limit: enough's enough

In Washington this week is establishment Republicans have made an agreement with the president to raise the debt ceiling in an unlimited fashion; no limit to the debt ceiling raise. This is extraordinary.
It's extraordinarily wrong. You'll see me on the floor of the Senate tomorrow filibustering this and saying enough is enough, no more debt.

We borrow a million dollars a minute: no more debt!

I left my medical practice and ran for office because I was concerned about an $18 trillion debt. We borrow a million dollars a minute. Now on the floor of the Congress, the Washington establishment from both parties puts forward
a bill that will explode the deficit. It allows President Obama to borrow unlimited amounts of money. I will stand firm. I I ask everyone in America to call Congress tomorrow and say: No more debt.

Use debt ceiling to force fiscal reform & discipline

Q: Do you oppose that budget deal because it doesn't cut those programs enough?

A: No, I oppose it because you're taking money from the entitlement and then spending it n other items. They're taking money from Social Security, and they're going to
spend it on the military and they're going to spend it on domestic spending. When you look at raising the debt limit, it should be leveraged to try to reform government. We should use the debt ceiling to force budgetary reform.

Borrowing a million a minute has gotta stop somewhere

I'm the only one on the stage who actually has a five-year budget that balances. I've put pencil to paper and I've said I would cut spending, and I've said exactly where. Each one of my budgets has taken a meat axe to foreign aid. We shouldn't borrow
money from China to send it anywhere. Out of your surplus, you can help your allies, but we cannot give away money we don't have. We do not project power from bankruptcy court. We're borrowing a million dollars a minute. It's got to stop somewhere.

Reform the tax code; address the national debt

Taxes: There is absolutely no question that the burdensome US Tax Code needs to be reformed.

Spending and Debt: As I speak to my constituents, I have found that their top concern is our national debt.

Audit the Fed: The Federal Reserve was
supposed to be overseen by Congress. The Fed is now in every nook and cranny of banking with unprecedented regulatory powers and no Congressional oversight. The Fed should be Audited and should be placed back under the control of Congress.

Balance the budget: slash spending, raise defense

Paul has outlined one of the most aggressive spending cut proposals in Congress--it would balance the federal budget within five years.
At the same time, in 2015 Paul ended years of calling for cutbacks in defense spending and proposed increasing the Pentagon's budget by $190 billion.

Source: PBS News Hour "2016 Candidate Stands" series
, Apr 7, 2015

The sequester is the law of the land: can't compromise on it

Q: Do you have a bottom line below which you will not go in accepting something that would end this standoff?

PAUL: I'm willing to compromise. But we're borrowing more than a million dollars every minute. So, we do have to address that.
I think the one thing I cannot accept is the Democrats want to exceed the sequester caps, these things that we put into law to restrain spending already. And it's funny, they're all about ObamaCare being the law of the land, but so is the sequester.
The sequester is the law of the land, and if we exceed that, it's a real big step in the wrong direction.

Q: The sequester means forced budget cuts that unless there is some agreement on Capitol Hill about spending, they go into place.

PAUL:
Yes, and to clarify what the sequester cuts are, they're a cut in the rate of increase of spending, because over ten years, even with the sequester, government will grow. It goes down for a year or two, but over 10 years, it grows.

Sequester doesn't cut spending; it just slows rate of growth

Look at how ridiculously Washington politicians have behaved over the sequester. The President did a big "woe is me" over a trillion dollar sequester that he endorsed and signed into law. Some Republicans joined him. But the sequester didn't even cut
any spending. It just slowed the rate of growth. Even with the sequester, government will grow over $7 trillion over the next decade. Only in Washington could an increase of $7 trillion in spending over a decade be called a cut.

After the sequester, it was announced that the White House would stop giving tours. Administration officials said that it was due to "cuts" imposed by the sequester. Meanwhile the President found an extra $250 million to send to Egypt.
You know, the country where mobs attacked our embassy, burned our flag, and chanted death to America. I say: not a penny more to countries that burn our flag. The President says he can't find anything to cut except for White House tours.

Penny Plan: Each $1 by one penny & balance budget by 2019

Tonight I urge you to demand a new course. Demand Washington change their ways, or be sent home.

To begin with, we absolutely must pass a Balanced Budget Amendment to the Constitution! The amendment must include strict tax and spending limitations.

Liberals complain that the budget can't be balanced but if you cut just one penny from each dollar we currently spend, the budget would balance within six or seven years.
The Penny Plan has been crafted into a bill that millions of conservatives across the country support.

Where would we cut spending; well, we could start with ending all foreign aid to countries that are burning our flag and chanting death to America.
The President could begin by stopping the F-16s and Abrams tanks being given to the radical Islamic government of Egypt.

Not every military dollar is necessary,nor every entitlement

President Obama's administration will add nearly $6 trillion to our national debt in just one term. This explosion of debt is unconscionable and unsustainable. Mr. President, we will not let you bankrupt this great nation!

Republicans and
Democrats alike must slay their sacred cows. Republicans must acknowledge that not every dollar spent on the military is necessary or well-spent, and Democrats must admit that domestic welfare and entitlements must be reformed.

Source: 2012 Republican National Convention speech
, Aug 29, 2012

Roll back federal spending to 2008 levels

One of the first things I did when I got to Washington was propose $500 billion in cuts to the budget for one year. This would have reduced our $1.5 trillion deficit by 1/3. My proposal would have simply rolled back federal spending to 2008 levels by
initiating reductions at various levels almost across the board. I would have cut the Departments of Agriculture and Transportation, which would have saved us $42 billion each. My proposed cuts to the Departments of Energy and Housing and Urban
Development would have saved another $50 billion each. I also included getting rid of the Department of Education and sending that responsibility back to the states, which would have saved another $80 billion, as well as spending reductions in
international aid, the Department of Health and Human Services, the Department of Homeland Security, and other federal agents. Not surprisingly, liberal Democrats thought all of these cuts were too "extreme."

Government not serious about controlling spending

[At a Tea Party rally speech at Bowling Green, Kentucky, April 15, 2009, Paul said]: We pay more in taxes now than we spend on food, clothes and housing combined. Taxes are high because spending is out of control. We are spending ourselves into oblivion.
Our deficit, as a percentage of gross national product, is greater than at any time in history. We are bankrupting our country, and the bottom line is that the politicians don't get it.

Debt crisis is approaching a point of no return

We face a looming debt crisis. It's worse than you can imagine. It really is coming upon us quickly. I went to a presentation this week and they said that Japan reached a point of no return. They say when its debt equals its economy, when your total debt
is about equal to your gross domestic product you approach a point of no return. We're quickly approaching that point, and what kind of leadership are we getting, though? The president of the United States wants to sound like he's now a conservative.
Says he's going to freeze spending. Well, he's going to freeze this much of the budget, at inflated levels of spending, and over five years he's going to add $3.8 trillion to the debt. It's unacceptable.

The House
Republican proposal will freeze this much of the budget at 2008 levels and will add $3 trillion to the debt over five years. It's too little. It's not enough. It's too timid, and we must be more bold.

Rand Paul on Voting Record

Bank bailout represented everything wrong with Washington

A vote for the bank bailout bill was wrong for many reasons--and particularly the way it was passed--1,000 pages long, printed at midnight and passed by noon the next day. No one read the bill. It came out of the shadows and was passed in the midst of a
government-created crisis, featuring new regulations and new powers for government, inserted into its crevices by anonymous clerks in the dead of night. The bank bailout represented everything that was wrong with Washington.

My father, a
Congressman, told me that he had banking lobbyists calling him and asking him about certain sections of the boll, and he said, "What bill?" He didn't have a copy yet.
They replied, "We do, would you like to see it?" You know government is out of control when lobbyists have the bills before members of Congress. Who is writing the bills, Congress or the lobbyists?

Bank bailout was bad policy & helped no banks in KY

CONWAY: Chris, I'm proposing a hometown tax credit, a 20% tax credit, for the cost of creating a new job. I think it's important that Americans see that our government is not just growing but that we're providing the incentives for the private sector to
grow us out of the recession. I also think that we need to get the small and community banks lending once again, because the government bailed out a bunch of big banks on Wall Street, and these regulators have come down awfully hard on the small communit
banks.

PAUL: But here's the problem. You say you want new lending from small banks, but you support the banking regulation bill. The problem was with government banks--Fannie Mae, Freddie Mac--bad policy at the Federal Reserve caused the recession,
caused the credit crunch. But yet Jack supports--President Obama supports--the new banking regulations, which every bank in Kentucky will tell you it wasn't our problem. No banks failed in Kentucky. But it's much harder to get a loan in Kentucky now.

Sponsored bill increasing debt limit to $16.7 trillion.

Paul sponsored America Pays Its Bills Act

A bill to increase the statutory limit on the public debt from $14.294 trillion to $16.7 trillion..

[Explanatory note from Wikipedia.com "Debt Ceiling Crisis"]:

The US debt-ceiling crisis was a financial crisis in 2011 that started as a debate in the Congress about increasing the debt ceiling. The immediate crisis ended when a complex deal was reached that raised the debt ceiling and reduced future government spending. However, similar debates are anticipated for the 2012 and 2013 budget. President Barack Obama and Speaker of the House John Boehner announced on July 31 that an agreement had been achieved. After the legislation was passed by both the House and Senate, President Obama signed the Budget Control Act. On August 5, the credit-rating agency Standard & Poor's downgraded the credit rating of US government bond for the first time in the country's history.

Under US law, an administration can spend only if it has sufficient funds to pay for it.
These funds can come either from tax receipts or from borrowing. Congress has set a debt ceiling, beyond which Treasury cannot borrow. The Obama administration stated that, without this increase, the federal government would shut down and the US would enter sovereign default, thereby creating an international crisis in the financial markets. Alternatively, default could be averted if the government were to promptly reduce its other spending by about half.

An increase in the debt ceiling requires the approval of both houses of Congress. A large majority of Democratic legislators (who held a majority in the Senate) favored tax increases along with smaller spending cuts. Supporters of the Tea Party movement pushed their fellow Republicans to reject any agreement that failed to incorporate large and immediate spending cuts or a constitutional amendment requiring a balanced budget.

Supports the Cut-Cap-and-Balance Pledge.

[The Cut-Cap-and-Balance Pledge is sponsored by a coalition of several hundred Tea Party, limited-government, and conservative organizations].

Despite our nation's staggering $14.4 trillion debt, there are many Members of the U.S. House and Senate who want to raise our nation's debt limit without making permanent reforms in our fiscal policies. We believe that this is a fiscally irresponsible position that would place America on the Road to Ruin. At the same time, we believe that the current debate over raising the debt limit provides a historic opportunity to focus public attention, and then public policy, on a path to a balanced budget and paying down our debt.

We believe that the "Cut, Cap, Balance" plan for substantial spending cuts in FY 2012, a statutory spending cap, and Congressional passage of a Balanced Budget Amendment to the Constitution is the minimum necessary precondition to raising the debt limit.
The ultimate goal is to get us back to a point where increases in the debt limit are no longer necessary. If you agree, take the Cut, Cap, Balance Pledge!

I pledge to urge my Senators and Member of the House of Representatives to oppose any debt limit increase unless all three of the following conditions have been met:

Cut: Substantial cuts in spending that will reduce the deficit next year and thereafter.

Cap: Enforceable spending caps that will put federal spending on a path to a balanced budget.

Balance: Congressional passage of a Balanced Budget Amendment to the U.S. Constitution -- but only if it includes both a spending limitation and a super-majority for raising taxes, in addition to balancing revenues and expenses.

Disapprove of increasing the debt limit.

Paul co-sponsored Joint Resolution on Debt Limit

Congressional Summary:JOINT RESOLUTION: Resolved by the Senate and House of Representatives: That Congress disapproves of the President's exercise of authority to increase the debt limit, as submitted on Jan. 12, 2012.

OnTheIssues Explanation: On Jan. 12, 2012, Pres. Obama notified Congress of his intent to raise the nation's debt ceiling by $1.2 trillion, two weeks after he had postponed the request to give lawmakers more time to consider the action. Congress then had 15 days to say no before the debt ceiling is automatically raised from $15.2 trillion to $16.4 trillion. Hence the debt ceiling was increased.

In Aug. 2011, the US government was nearly shut down by an impasse over raising the debt ceiling; under an agreement reached then, the President could raise the debt limit in three increments while also implementing $2.4 trillion in budget cuts. The agreement also gave Congress the option of voting to block each of the debt-ceiling increases by passing a "resolution of disapproval." The House disapproved; the Senate, by declining to vote in the 15-day window, killed the Resolution. Even if the resolution were passed, Pres. Obama could veto it; which could be overridden by a 2/3 majority in the House and Senate. The House vote only had 57% approval, not enough for the 67% override requirement, so the Senate vote became moot. The same set of actions occurred in Sept. 2011 for the first debt ceiling increase.

Endorsed Liberty Candidate: End the Federal Reserve.

Paul is endorsed by Congressional endorsement list

A Liberty Candidate will Defend the Great American Principles of Sound Money and Constitutional Government, [such as the views of] Peter Schiff, Senate 2010 candidate from Connecticut, on the Economy: "Strong fiscally conservative principles and beliefs that our economic recovery should be left to the free market through businesses and individuals--not the federal government."

And [such as the views of] R.J. Harris, Congress 2010 candidate from Oklahoma on Ending the Federal Reserve: "What goes on at the Fed is a clear example of the infringement upon our liberty and national sovereignty through Congressional delegation of its authority. Now, the Fed refuses to even let us see how much and to whom our money has been loaned or how much they have indebted the American People. They do so by rightly asserting that they are a private entity and therefore do not have to comply with orders to open their books. Our Congress has completely lost control over the creation of money and credit and now we are all going to pay the price of that abrogation of their duty."